Six China residents charged with stealing US mobile phone technology

Six residents of China face economic espionage and theft of trade secret charges for allegedly funneling radio frequency technologies used in mobile devices from U.S. companies to a university controlled by the Chinese government.

The defendants facing charges in the U.S. are connected to Tianjin University in China. The U.S. Department of Justice released a 32-count indictment on Tuesday, three days after Tianjin University Professor Hao Zhang was arrested at the Los Angeles airport while trying to enter the U.S. from China. The five other defendants remain at large.

The six are charged with stealing thin-film bulk acoustic resonator (FBAR) technology used in mobile phones from two U.S. companies, according to a DOJ press release. FBAR technology filters incoming and outgoing wireless signals so that a mobile phone only receives and transmits the specific communications intended by the user. In addition to consumer applications, FBAR is used in several military and communications technologies.

The defendants accessed sensitive U.S. technologies to share trade secrets with the Chinese government for "economic advantage," Assistant Attorney General John Carlin said in a statement. "Economic espionage imposes great costs on American businesses, weakens the global marketplace and ultimately harms U.S. interests worldwide."

Zhang met fellow defendant Wei Pang at the University of Southern California during their doctoral studies in electrical engineering in the early 2000s, according to the indictment. The two researched FBAR technology, with funding by the U.S. Defense Advanced Research Projects Agency (DARPA), while at USC.

After the two earned their doctorates in about 2005, Pang began working as an FBAR engineer with Avago Technologies in Colorado, and Zhang accepted employment as an FBAR engineer with Skyworks Solutions in Massachusetts. Both companies were involved in designing FBAR technologies at the time.

In 2006 and 2007, Pang, Zhang and other co-conspirators prepared a business plan and began soliciting Chinese universities and other organizations for opportunities to start manufacturing FBAR technology in China, the DOJ said. In 2008, officials from Tianjin University flew to San Jose, California, to meet the defendants, and later agreed to help Pang, Zhang and others establish an FBAR fabrication facility in China.

Pang and Zhang continued to work for the two U.S. companies while coordinating with Tianjin University, the DOJ said. In mid-2009, Pang and Zhang resigned from the U.S. companies and accepted positions as full professors at Tianjin University. Tianjin University later formed a joint venture to produce FBAR technology, called ROFS Microsystem, with Pang, Zhang and others.

The indictment alleges that Pang, Zhang and other co-conspirators stole recipes, source code, specifications, presentations, design layouts and other documents marked as confidential and proprietary from the victim companies and shared the information with each other and with Tianjin University.

The stolen trade secrets enabled Tianjin University to construct and equip a state-of-the-art FBAR fabrication facility and then to obtain contracts for providing FBARs to commercial and military entities.

The six indicted defendants are:

Zhang, 36, is a professor at Tianjin University. Zhang is charged with conspiracy to commit economic espionage, conspiracy to commit theft of trade secrets, economic espionage and theft of trade secrets.

Pang, 35, is a professor at Tianjin University. Pang is charged with conspiracy to commit economic espionage, conspiracy to commit theft of trade secrets, economic espionage and theft of trade secrets.

Jinping Chen, 41, is a professor at Tianjin University and a member of the board of directors for ROFS Microsystem. Chen is charged with conspiracy to commit economic espionage and conspiracy to commit theft of trade secrets.

Huisui Zhang, 34, studied with Pang and Hao Zhang at USC and received a master's degree in electrical engineering in 2006. Huisui Zhang is charged with conspiracy to commit economic espionage and conspiracy to commit theft of trade secrets.

Chong Zhou, 26, is a Tianjin University graduate student and a design engineer at ROFS Microsystem. Zhou studied under Pang and Hao Zhang, and is charged with conspiracy to commit economic espionage, conspiracy to commit theft of trade secrets, economic espionage and theft of trade secrets.

Zhao Gang, 39, is the general manager of ROFS Microsystems. Gang is charged with conspiracy to commit economic espionage and conspiracy to commit theft of trade secrets.

The maximum penalty for conspiracy to commit economic espionage is 15 years in prison and a US$500,000 fine or twice the loss to victims. Aiding and abetting economic espionage carries the same maximum penalties. The trade secrets charges each carry a maximum penalty of 10 years in prison and a $250,000 fine or twice the loss.

Lawyers for the defendants and representatives of Tianjin University weren't immediately available for comment.

Grant Gross covers technology and telecom policy in the U.S. government for The IDG News Service. Follow Grant on Twitter at GrantGross. Grant's email address is grant_gross@idg.com.

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